Broadband agencies hear complaints from all sides

Senators voiced competing priorities at a hearing on broadband stimulus funds

Two U.S. agencies tasked with distributing US$7.2 billion in broadband deployment money over the next year heard complaints from one U.S. senator Tuesday that they were moving too fast.

A second senator, at a hearing before the Senate Commerce, Science and Transportation Committee, complained that the funds weren't being distributed fast enough.

Another group of senators complained that the U.S. Rural Utilities Service (RUS), one of the two agencies, had eliminated many unserved rural areas from eligibility. Then again, other senators noted that the RUS, in the past, has funded broadband projects where service already existed

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Two U.S. agencies tasked with distributing US$7.2 billion in broadband deployment money over the next year heard complaints from one U.S. senator Tuesday that they were moving too fast.

A second senator, at a hearing before the Senate Commerce, Science and Transportation Committee, complained that the funds weren't being distributed fast enough.

Another group of senators complained that the U.S. Rural Utilities Service (RUS), one of the two agencies, had eliminated many unserved rural areas from eligibility. Then again, other senators noted that the RUS, in the past, has funded broadband projects where service already existed

The conflicting priorities voiced at Tuesday's hearing demonstrated the pressure the RUS and the National Telecommunications and Information Administration (NTIA) are under as they attempt to distribute a first round of $4 billion in broadband grants and loans by the end of the year.

An inspector general's report from March found that the RUS, since September 2005, loaned about $913 million to 37 applicants for broadband deployment under a separate program, said Senator Claire McCaskill, a Missouri Democrat. However, 34 of those applications, for $873 million, were for broadband deployment in areas where service already existed, she said.

"I just don't want federal money competing with people who've investments without the help of federal money," McCaskill said. "I don't think it's fair to those companies."

RUS administrator Jonathan Adelstein said his agency was working to find the right definition for geographic areas eligible for the new funding, approved in the American Recovery and Reinvestment Act, a huge economic stimulus package. But before McCaskill spoke, three other senators complained that the RUS, in defining "remote" areas eligible for a targeted grant program as those that are 50 miles outside cities, was leaving out large areas now unserved by broadband.

There are large sections of Arkansas that aren't covered by broadband, but only a couple of areas that would be eligible for the remote grants, said Senator Mark Pryor, an Arkansas Democrat.

Adelstein said the RUS is trying to rework the definition of remote areas, for which $400 million is set aside for last-mile projects.

"It turns out maybe we went too far, and a lot of West Virginia wasn't counted and a lot of Arkansas wasn't counted," Adelstein said. "Our goal is, I think, shared, which is that those funds reach the hardest-to-reach areas."

In addition to concerns from senators, the U.S. Government Accountability Office (GAO) issued a report Tuesday saying the two agencies face several challenges in meeting congressional deadlines for distributing the $7.2 billion.

Both agencies will have "far fewer staff" to monitor the new broadband projects than they have for existing programs, said Mark Goldstein, the GAO's director of physical infrastructure issues. "The upcoming deadline for awarding funds may pose risks to the thoroughness of the application evaluation process," he said.

The IDG News Service is a Network World affiliate.